Cautious fiscal outlook for new governor

(Calif.) Next week, Gavin Newsom will be sworn in as California’s 40th governor, and three days later, he must submit his first proposed budget to the Legislature.

He has big shoes to fill.

Former Gov. Jerry Brown leaves the executive office with the state in as good a fiscal condition as could be imagined with the ‘wall of debt’ that Brown inherited out of the recession drastically reduced and replaced by a surplus in the rainy day fund of close to $14 billion.

Newsom’s first budget should be telling about how the former mayor of San Francisco and lieutenant governor intends to deal with a super majority of fellow Democrats that are very interested in spending some of those reserves.

The economic outlook, especially in light of the gyrations of recent days on Wall Street, suggests the boom times may be coming to a close or, at least, a slowdown.

Revenues collected in the month of November exceeded estimates by almost $1.3 billion, which put the state nearly $2.3 billion ahead of expectations made in June as part of the budget negotiations.

Most analysts believe the national economy as well as that in California will continue to be strong, that unemployment will remain low and business activity robust. Many also say, however, that 2019 will not be nearly as good a year as 2018.

Thus, Newsom probably has some latitude to increase funding for new programs and services.

That’s good news for everyone but schools.

Under Proposition 98, the state’s minimum funding guarantee, K-12 schools and community colleges are probably not going to see many additional dollars next year. The most likely scenario will result in the funding formula providing about the same amount to schools as last year.

Still, the new governor may look at a number of proposals that will benefit public education including:

Universal preschool and child care

Newsom said California must expand its existing programs “that support the health and wellbeing of our state’s babies and their families.”

He notes that all families should have access to preschool and child care programs because “a parent should never have to choose between keeping a job and taking care of their newborn.”

Community Schools

Newsom wants to alter the scope of services that schools now provide by expanding the number of Community Schools statewide. Community Schools, in general, add health care and social services into the mix, and become a focal point of neighborhood integration.

STEM

Newsom notes that California has some 70,000 unfilled jobs in the hi-tech industry and vows to require computer science coursework in all high schools in California.

Teacher Shortage

Newsom said he understands the problem and plans to “develop and encourage” new incentives to bring more young people into the profession.

Apprenticeships

Newsom, like a growing number of policy leaders, said he recognizes that college isn’t a viable option for many high school students. His plan would establish a goal of creating 500,000 “earn-and-learn” vocational apprenticeships by 2029.